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If you hold onto your points too long, you could wake up one day to find your balance is zero

Readers often complain about loyalty plans that require them to collect or redeem points on a regular basis.

They don’t realize they have to stay active to qualify for free flights or luxury items. And they blame the plan sponsor for not giving any notice when their points are about to expire.

Take Robert Neilly, who tried to pay for a purchase last weekend with his Sears Club points. He found they had been taken away because he hadn’t used his credit card for a while.

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“The only solution they offered was to buy a long-distance phone plan, which would give me most of my points back,” he said. “Well, that was the last straw. I’ll never shop at Sears again.”

Sears and Chase (its credit card service provider) both said his points could be restored as a good will gesture when I contacted them.

Another reader had an MBNA MasterCard that gave him points to redeem for Sony products. His latest statement showed that 40 per cent of his points had expired.

“When I called to complain, I was told about a clause in the agreement that says unused points expire in five years. But I wasn’t given any notice on previous statements that these points would expire,” he said.

“This is my main credit card that I used every month, paid on time every month as well. I thought I could accumulate points until I had enough for something substantial.”

When I got involved, MBNA agreed to reinstate his points if he used them right away to buy Sony products.

The activity rules make sense when you consider why loyalty plans exist in the first place.

If you hold on to points without redeeming them, you’re seen as a liability to a loyalty plan whose goal is to move merchandise.

Besides, it costs money to carry an inactive account month to month.

Some plans, such as Shoppers Drug Mart’s Optimum points, don’t have any expiry dates.

Others, such as the TD GM Visa card, required customers to buy or lease a new car within seven years.

General Motors dropped out last year, but cardholders can use their points for a new or leased GM car until Dec. 31, 2012.

Meanwhile, TD has replaced the GM card with a Drivers Reward Card that lets you buy or lease any make or model of new or used vehicle. The points never expire, as long as you’re a cardholder.

Aeroplan, Air Canada’s 25-year-old loyalty plan, started tightening up enforcement of expiry dates before its initial public offering in 2005.

In 2007, Aeroplan changed the activity rules for its four million members. They lose all their points unless they have collected or redeemed points over the previous 12-month period.

“A 12-month period would be short if the number of opportunities to stay active were really narrow,” says David Klein, vice-president of marketing.

“We have so many retail partners – such as Esso, Home Hardware, Rexall – that it’s not difficult for a member to stay active.”

I get many complaints about Aeroplan zapping points and being inflexible when asked for help. Maybe the new activity rules haven’t yet sunk in.

Members can see the current status of their points and the expiry date when they log into their accounts online, Klein points out.

They also get email notices before their points expire – but only get letters if there’s no email address on file.

My advice: Update your email and home addresses with the loyalty plans you belong to, so you don’t miss important notices. Don’t wait for a call, which you probably won’t get.

Ellen Roseman writes about personal finance and consumer issues. You can reach her at eroseman@thestar.ca.

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